What changed in this filing

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Item 2. Management’s Discussion and Analysis

2024-05-15 compared with 2023-11-14 · 293 added, 268 removed, 162 unchanged (78% of the section changed)

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking

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States, Singapore, Hong Kong, Australia and South Korea.

We manage a significant portion of our businesses through our 85.4% owned subsidiary,

Alset International Limited, a public company traded on the Singapore Stock Exchange.

Through this subsidiary (and indirectly, through

other public and private U.S.

and Asian subsidiaries), we are actively developing real estate projects near Houston, Texas and in Frederick,

Maryland, in our real estate segment.

In our digital transformation technology segment, we focus on serving business-to-business (B2B)

needs in e-commerce, collaboration and social networking functions.

We manage our three principal businesses primarily through our 85.5% owned subsidiary,

Alset International, a public company traded on the Singapore Stock Exchange.

Through this subsidiary (and indirectly, through other

public and private U.S.

and Asian subsidiaries), we are actively developing real estate projects near Houston, Texas in our real estate

In our digital transformation technology segment, we focus on serving business-to-business (B2B) needs in e-commerce, collaboration

and social networking functions.

Our biohealth segment includes the sale of consumer products.

also have ownership interests outside of Alset International, including a 36.9% equity interest in American Pacific Bancorp Inc., an

indirect 14.1% equity interest in Holista CollTech Limited, a 44.8% equity interest in DSS Inc.

(“DSS”), a 48.7% equity interest

in Value Exchange International, Inc., a 0.5% equity interest in New Electric CV Corporation (“NECV” formerly known as “American

Premium Mining Corporation” or “APM,” and earlier known as “American Premium Water Corp.”), and 33.4% equity

interest in Sharing Services Global Corp.

American Pacific Bancorp Inc.

is a financial network holding company.

Holista CollTech Limited is a public Australian company that produces natural food ingredients (ASX:

DSS is a multinational company

operating businesses within nine divisions:

product packaging, biotechnology, consumer marketing, commercial lending, securities and

investment management, alternative trading, secure living, and alternative energy.

is listed on the NYSE American (NYSE:

Value Exchange International, Inc.

also have ownership interests outside of Alset International, including a 36.9% equity interest in American Pacific Financial, Inc.,

formerly known as American Pacific Bancorp Inc.

(“APF”), an indirect 13% equity interest in Holista CollTech Limited (“Holista”),

a 44.4% equity interest in DSS Inc.

(“DSS”), an indirect 48.7% equity interest in Value Exchange International Inc.

a 0.5% equity interest in New Electric CV Corporation (“NECV”, formerly known as “American Wealth Mining Inc.”)

and a 33.4% equity interest in Sharing Services Global Corporation (“SHRG”).

APF is a financial network holding company.

Holista is a public Australian company that produces natural food ingredients (ASX:

DSS is a multinational company operating businesses

within nine divisions:

product packaging, biotechnology, direct marketing, commercial lending, securities and investment management,

alternative trading, digital transformation, secure living, and alternative energy.

DSS is listed on the NYSE American (NYSE:

is a provider of information technology services for businesses, and is traded on the OTCQB (OTCQB:

NECV is a publicly traded consumer products company (OTCPK:

SHRG markets and distributes health and wellness products,

as well as member-based travel services, using a direct selling business model.

NECV is a publicly traded

consumer products company (OTCPK:

SHRG markets and distributes health and wellness products, as well as member-based travel services,

using a direct selling business model.

SHRG is traded on the OTCQB (OTCQB:

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and our stockholders.

Capital Acquisition Corp.

February 3, 2022 Alset Capital Acquisition Corp.

(“Alset Capital”), a special purpose acquisition company sponsored by the

Company and certain affiliates, closed its initial public offering of 7,500,000 units at $10 per unit.

Each unit consisted of one of

Alset Capital’s shares of Class A common stock, one-half of one redeemable warrant and one right to receive one-tenth of one share

of Class A common stock upon the consummation of an initial business combination.

Each whole warrant entitles the holder thereof to purchase

one share of Class A common stock at a price of $11.50 per share.

Only whole warrants are exercisable.

The underwriters exercised their

over-allotment option in full for an additional 1,125,000 units on February 1, 2022, which closed at the time of the closing of the Offering.

As a result, the aggregate gross proceeds of this offering, including the over-allotment, were $86,250,000, prior to deducting underwriting

discounts, commissions, and other offering expenses.

February 3, 2022, simultaneously with the consummation of Alset Capital’s initial public offering, Alset Capital consummated the

private placement of 473,750 units (the “Private Placement Units”) to the Sponsor, which amount includes 33,750 Private Placement

Units purchased by the Sponsor in connection with the underwriters’ exercise of the over-allotment option in full, at a price of

$10.00 per Private Placement Unit, generating gross proceeds of approximately $4.7 million (the “Private Placement”) the

proceeds of which were placed in the trust account.

No underwriting discounts or commissions were paid with respect to the Private Placement.

The Private Placement Units are identical to the units sold in the initial public offering, except that (a) the Private Placement Units

and their component securities will not be transferable, assignable or saleable until 30 days after the consummation of Alset Capital’s

initial business combination except to permitted transferees and (b) the warrants and rights included as a component of the Private Placement

Units, so long as they are held by the Sponsor or its permitted transferees, will be entitled to registration rights, respectively.

Company and its majority-owned subsidiary Alset International together own the sole member of Alset Acquisition Sponsor, LLC, the sponsor

of Alset Capital.

September 9, 2022, Alset Capital entered into an agreement and plan of merger (the “Merger Agreement”) by and among Alset

Capital, HWH International Inc., a Nevada corporation (“HWH”) and HWH Merger Sub Inc., a Nevada corporation and a wholly

owned subsidiary of Alset Capital (“Merger Sub”).

Pursuant to the Merger Agreement, a business combination between Alset

Capital and HWH will be effected through the merger of Merger Sub with and into HWH, with HWH surviving the merger as a wholly owned

subsidiary of Alset Capital (the “Merger”).

HWH is an indirect subsidiary of the Company through its subsidiary Alset International

a Special Meeting of Stockholders held on May 1, 2023 (the “Alset Capital Special Meeting”), Alset Capital filed an

amendment to its Amended and Restated Certificate of Incorporation with the Delaware Secretary of State on May 2, 2023, to (i)

revise Alset Capital’s right to extend the date by which it has to consummate a business combination;

and (ii) expand the methods that it may employ to not become subject to the “penny

stock” rules of the Securities and Exchange Commission.

connection with the Alset Capital Special Meeting, 6,648,964 shares of the Class A Common Stock of Alset Capital were tendered for redemption.

Following this redemption, 2,449,786 shares of the Class A Common Stock of Alset Capital remained issued and outstanding, including 473,750

shares held by Alset Acquisition Sponsor, LLC and 1,976,036 public shares.

Alset Acquisition Sponsor, LLC owns 2,156,250 shares of Class

B Common Stock.

August 1, 2023, Alset Capital held a Special Meeting of Stockholders.

In connection with this Special Meeting, Alset Capital’s

business combination with HWH International Inc.

was approved by its stockholders and certain amendments to Alset Capital’s Amended

and Restated Certification of Incorporation were also approved.

Alset Capital is working to close the business combination, subject to

the completion of certain closing conditions.

November 2, 2023, Alset Capital held an additional Special Meeting of Stockholders.

The stockholders of Alset Capital extended the date

before which the Company must complete a business combination from November 3, 2023, to February 3, 2024.

of the Merger of Alset Capital Acquisition Corp.

and HWH International Inc.

January 9, 2024, two entities affiliated with Alset Inc.

completed a previously announced transaction.

On September 9, 2022, Alset Capital

Acquisition Corp., a Delaware corporation (“Alset Capital”) entered into an agreement and plan of merger (the “Merger

Agreement”) with our indirect subsidiary HWH International Inc., a Nevada corporation (“HWH”) and HWH Merger Sub Inc.,

a Nevada corporation and a wholly owned subsidiary of Alset Capital (“Merger Sub”).

The Company and its 85.5% owned subsidiary

Alset International own Alset Acquisition Sponsor, LLC, the sponsor (the “Sponsor”) of Alset Capital.

to the Merger Agreement, on January 9, 2024, a business combination between Alset Capital and HWH was effected through the merger of

Merger Sub with and into HWH, with HWH surviving the merger as a wholly owned subsidiary of Alset Capital (the “Merger”),

and Alset Capital changing its name to HWH International Inc.

total consideration paid at the closing of the Merger by New HWH to the HWH shareholders was 12,500,000 shares of New HWH common stock.

Alset International owned the majority of the outstanding shares of HWH at the time of the business combination, and received 10,900,000

shares of New HWH as consideration for its shares of HWH.

HWH currently has 16,223,301 shares of common stock issued and outstanding.

Of these shares, a total of 13,577,375 shares of New HWH

common stock are now owned by the Sponsor and Alset International together.

In addition, the Sponsor owns warrants convertible into up

to 236,875 shares of New HWH common stock upon exercise.

HWH is in the midst of implementing the new membership model described below (the “New Model”), that operates on a yearly

subscription basis.

New HWH intends to resume membership sales, albeit under the New Model, in approximately 2nd quarter of 2024.

Members get exclusive discounts on HWH Marketplace products, priority invites to product launch events and other parties, and can earn

passive income when a member’s referral signs up for membership or makes an initial purchase through the HWH Marketplace products

through them.

of Rental Business from Majority-Owned Subsidiary

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entered into an agreement with Alset EHome Inc.

and Alset International Limited pursuant to which Alset

agreed to reorganize the ownership of its home rental business.

and Alset International pursuant to which Alset Inc.

to reorganize the ownership of its home rental business.

Previously, Alset Inc.

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112 of these rental homes are owned by subsidiaries of American Home REIT Inc.

owns 85.4% of Alset International Limited, and Alset International Limited indirectly owns approximately 99.9% of Alset EHome

owns 85.5% of Alset International, and Alset International indirectly owns approximately 99.9% of Alset EHome Inc.

closing of the transaction contemplated by this agreement was completed on January 13, 2023.

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become the direct owner of AHR and its subsidiaries that collectively own these 112 homes, instead of such homes being owned indirectly

through Alset International Limited’s subsidiaries.

through Alset International’s subsidiaries.

sold AHR to Alset Inc.

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as of November 30, 2022.

closing of this transaction was approved by the shareholders of Alset International Limited and the transaction was closed on January

Certain members of Alset Inc.’s Board of Directors and management are also members of the Board of Directors and management

of each of Alset International Limited and Alset EHome Inc.

closing of this transaction was approved by the shareholders of Alset International and the transaction was closed on January 13, 2023.

Certain members of Alset Inc.’s Board of Directors and management are also members of the Board of Directors and management of

each of Alset International and Alset EHome Inc.

February 6, 2023, we entered into an Underwriting Agreement (the “Underwriting Agreement”) in connection with an offering

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of Travel Business

June 14, 2023, Hotapp Blockchain Pte.

Ltd., (“Hotapp”) a wholly owned subsidiary of Hapi Metaverse Inc., a majority owned

subsidiary of the Company, entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”) in connection with its

purchase of all of the outstanding shares of Hapi Travel Limited, a Hong Kong corporation, from Business Mobile Intelligence Inc.

for a total consideration of $214,993 (the “Purchase Price”).

In order to facilitate the Stock Purchase Agreement, Hapi Metaverse

made a loan (the “Loan”) in an amount equal to the Purchase Price to Hotapp.

Chan Heng Fai, the chairman of the Company,

is also Chairman of Hotapp and the sole stockholder of BMI, and therefore recused himself from any deliberation or voting regarding the

Stock Purchase Agreement and the Loan.

June 14, 2023, the Company’s subsidiary completed acquisition of Hapi Travel Limited (“HTL”), an online travel business

started in Hong Kong and under common control of the Company.

The accompanying consolidated financial statements include the operations

of the acquired entity from its acquisition date.

The acquisition has been accounted for as a business combination.

Accordingly, consideration

paid by the Company to complete the acquisition is initially allocated to the acquired assets and liabilities assumed based upon their

estimated fair values on the acquisition date.

The recorded amounts for assets acquired and liabilities assumed are provisional and subject

to change during the measurement period, which is up to 12 months from the acquisition date.

As a result of the acquisition of HTL, a

deemed dividend of $214,174 was generated as a result of the business combination, which represents the purchase price of $214,993 in

excess of identifiable equity.

common control transaction described above resulted in the following basis of accounting for the financial reporting periods:

The acquisition

of HTL was accounted for prospectively as of June 14, 2023 as this did not represent a change in reporting entity.

The acquisition of HTL

was under common control and was consolidated in accordance with ASC 850-50.

The Consolidated financial statements were not retrospectively

adjusted for the acquisition of HTL as of January 1, 2022 for comparative purposes because the historical operations of HTL were

deemed to be immaterial to the Company’s consolidated financial statements.

of Sentinel Brokers Company Inc.

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October 28, 2022, 150 CCM Black Oak Ltd.

(the “Seller”), a Texas Limited Partnership and an indirect, majority-owned subsidiary

of the Company, entered into a Contract for Purchase and Sale and Escrow Instructions (the “Agreement”) with Century Land

Holdings of Texas, LLC, a Colorado limited liability company (the “Buyer”).

Pursuant to the terms of the Agreement, the Seller

agreed to sell all of the approximately 242 single-family detached residential lots comprising a residential community in the city of

Magnolia, Texas known as the “Lakes at Black Oak.”

November 28, 2022, the parties to the Agreement entered into an amendment to the Agreement, pursuant to which the Seller agreed to sell

approximately 131 lots instead of 242 lots, and the anticipated purchase price was reduced.

April 13, 2023, the sale of the 131 lots was completed and the Seller received a total consideration of $6,615,500 from the Buyer.

Seller was required to develop and improve the property at the Seller’s cost pursuant to certain development plans and government

regulations prior to the closing described above.

(the “Seller”), a Texas Limited Partnership and subsidiary of the Company, entered

into a Contract for Purchase and Sale and Escrow Instructions (the “Agreement”) with Century Land Holdings of Texas, LLC,

a Colorado limited liability company (the “Buyer”).

Pursuant to the terms of the Agreement, the Seller agreed to sell approximately

242 single-family detached residential lots comprising a residential community in the city of Magnolia, Texas known as the “Lakes

at Black Oak.” On November 28, 2022, the parties to the Agreement entered into an amendment to the Agreement (the “Amendment”).

Pursuant to the Amendment, the parties agreed that the Buyer would purchase approximately 131 single-family detached residential lots,

instead of 242 lots.

This transaction closed on April 13, 2023.

to Sell 110 Lots

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Pursuant to the terms

of the Purchase and Sale Agreement, the Seller has agreed to sell approximately 189 single-family detached residential lots developed

within section 2 of Black Oak project.

of the Purchase and Sale Agreement, the Seller had agreed to sell approximately 189 single-family detached residential lots developed

within section 2 of Lakes at Black Oak project.

The sale of the first 94 lots closed on May 30, 2023.

The sale of remaining lots is estimated

to close at the end of the year 2023.

of Value Exchange International, Inc.

Shares and Conversion of Loan

October 17, 2022, our majority-owned subsidiary Hapi Metaverse entered into a Stock Purchase Agreement (the “Stock Purchase Agreement”)

with Chan Heng Fai, who is the Chairman of Hapi Metaverse’s Board of Directors and the Chairman, Chief Executive Officer and largest

stockholder of Alset Inc.

Pursuant to the Stock Purchase Agreement, Hapi Metaverse bought an aggregate of 7,276,163 shares of Value Exchange

International Inc.

(“VEII”) for the following purchase prices:

(i) $1,733,079 for 7,221,163 shares, representing a price

of $0.24 per share;

(ii) $2,314 for 10,000 shares, representing a price of $0.2314 per share;

(iii) $5,015 for 25,000 shares, representing

a price of $0.2006 per share;

and (iv) $3,326 for 20,000 shares, representing a price of $0.1663 per share.

Collectively, these purchases

represent an aggregate purchase price of $1,743,734 for 7,276,163 shares of VEII.

Such purchase prices were negotiated between the parties

to the Stock Purchase Agreement.

September of 2023, the Company’s subsidiary Hapi Metaverse converted $1,300,000 of the principal amount loaned to VEII into 7,344,632

shares of VEII’s common stock.

Under the terms of the Credit Agreement, the Company’s subsidiary Hapi Metaverse received

common stock warrants to purchase a maximum of 36,723,160 shares of VEII common stock at an exercise price of $0.1770 per share.

warrants expire five (5) years from date of their issuance.

The sale of remaining lots closed

on January 4, 2024.

of Convertible Loans to Value Exchange International, Inc.

January 27, 2023, the Company and New Electric CV Corporation (together with the Company, the “Lenders”) entered into a Convertible

Credit Agreement (the “Credit Agreement”) with VEII.

The Credit Agreement provides VEII with a maximum credit line of $1,500,000

with simple interest accrued on any advances of the money under the Credit Agreement at 8%.

The Credit Agreement grants conversion rights

to each Lender.

Each Advance shall be convertible, in whole or in part, into shares of VEII’s Common Stock at the option of the

Lender who made that Advance (being referred to as a “Conversion”), at any time and from time to time, at a price per share

equal the “Conversion Price”.

In the event that a Lender elects to convert any portion of an Advance into shares of VEII

Common Stock in lieu of cash payment in satisfaction of that Advance, then VEII would issue to the Lender five (5) detachable warrants

for each share of VEII’s Common Stock issued in a Conversion (“Warrants”).

Each Warrant will entitle the Lender to

purchase one (1) share of Common Stock at a per-share exercise price equal to the Conversion Price.

The exercise period of each Warrant

will be five (5) years from date of issuance of the Warrant.

On February 23, 2023, Hapi Metaverse loaned VEII $1,400,000 (the “Loan

The Loan Amount can be converted into shares of VEII pursuant to the terms of the Credit Agreement for a period of three

There is no fixed price for the derivative security until Hapi Metaverse converts the Loan Amount into shares of VEII Common Stock.

September 6, 2023, the Company converted $1,300,000 of the principal amount loaned to VEII into 7,344,632 shares of VEII’s Common

Under the terms of the Credit Agreement, Hapi Metaverse received Warrants to purchase a maximum of 36,723,160 shares of VEII’s

Common Stock at an exercise price of $0.1770 per share.

Such warrants expire five (5) years from date of their issuance.

December 14, 2023, Hapi Metaverse entered into a Convertible Credit Agreement (“Credit Agreement”) with VEII.

15, 2023, the company loaned VEII $1,000,000.

The Credit Agreement was amended pursuant to an agreement dated December 19, 2023.

the Credit Agreement, as amended, this amount can be converted into VEII’s Common Shares pursuant to the terms of the Credit Agreement

for a period of three years.

In the event that Hapi Metaverse converts this loan into shares of VEII’s Common Stock, the conversion

price shall be $0.045 per share.

In the event that Hapi Metaverse elects to convert any portion of the loan into shares of VEII’s

Common Stock in lieu of cash payment in satisfaction of that loan, then VEII will issue to Hapi Metaverse five (5) detachable warrants

for each share of VEII’s Common Stock issued in a conversion (“Warrants”).

Each Warrant will entitle the company to

purchase one (1) share of VEII’s Common Stock at a per-share exercise price equal to the Conversion Price.

The exercise period

of each Warrant will be five (5) years from date of issuance of the Warrant.

At the time of this filing, the company has not converted

the Loan Amount.

Company currently owns a total of 21,179,275 shares (representing approximately 48.7%) of VEII.

Chan and another member of the Board of Directors of Hapi Metaverse, Lum Kan Fai Vincent, are both members of the Board of Directors

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Wong Tat Keung).

Shares Dividend Received from DSS

May 4, 2023, DSS distributed approximately 280 million shares of Sharing Services Global Corporation (“SHRG”) beneficially

held by DSS and its subsidiaries in the form of a dividend to the shareholders of DSS common stock.

As a result of this distribution,

the Company directly received 70,426,832 shares of SHRG, and through its majority-owned subsidiary Alset International, and certain subsidiaries

of Alset International, indirectly received additional 55,197,696 shares of SHRG.

The Company and its majority-owned subsidiaries now

collectively own 125,624,528 shares of SHRG, representing 33.4% of the issued and outstanding shares of SHRG Common Stock (such number

of SHRG shares held and ownership percentage do not include any shares held by affiliates of the Company which we do not hold a majority

interest in).

Additionally, our founder, Chairman and Chief Executive Officer, Chan Heng Fai, directly and indirectly is the owner of

an additional 37,947,756 shares of SHRG and is a beneficial owner of approximately 43.5% of SHRG shares (including those shares owned

by Alset Inc.

and its majority-owned subsidiaries).

of Convertible Loans to Sharing Services Global Corp.

January 17, 2024, the Company received a Convertible Promissory Note (the “Convertible Note”) from Sharing Services Global

(“SHRG”), an affiliate of the Company, in exchange for a $250,000 loan made by the Company to SHRG.

The Company may

convert a portion or all of the outstanding balance due under the Convertible Note into shares of SHRG’s common stock at the average

closing market price of SHRG stock within the last three (3) days from the date of conversion notice.

The Convertible Note bears a 10%

interest rate and has a scheduled maturity six (6) months from the date of the Convertible Note, or July 17, 2024.

March 20, 2024, HWH International Inc., a subsidiary of the Company (“HWH”), entered into a Securities Purchase Agreement

(the “Securities Purchase Agreement”) with SHRG, pursuant to which HWH purchased from SHRG a (i) Convertible Promissory Note

in the amount of $250,000, convertible into 208,333,333 shares of SHRG’s common stock at the option of HWH, and (ii) certain warrants

exercisable into 208,333,333 shares of SHRG’s common stock at an exercise price of $0.0012 per share, the exercise period of the

warrant being five (5) years from the date of the Securities Purchase Agreement, for an aggregate purchase price of $250,000.

time of filing, HWH has not converted any of the debt contemplated by the Convertible Note nor exercised any of the warrants.

of Chief Operating Officer

March 10, 2024, Anthony S.

Chan resigned as Chief Operating Officer of Alset Inc.

(the “Company”), effective immediately,

due to personal reasons.

Chan’s resignation is not the result of any disagreement with the Company.

Chan remains as a consultant

to the Company.

that May or Are Currently Affecting Our Business

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of Operations

of Statements of Operations for the Three and Nine Months Ended September 30, 2023 and 2022

of Statements of Operations for the Three Months Ended March 31, 2024 and 2023

Three- Months Ended

Nine-months Ended

September 30, 2023

September 30, 2022

September 30, 2023

September 30, 2022

March 31, 2024

March 31, 2023

Operating Expenses

$ (8,352,720 )

$ (3,016,666 )

Other Expenses

Income Tax (Expense) Benefit

$ (5,047,279 )

$ (2,233,452 )

Income Tax Expense

$ (7,313,792 )

$ (4,323,182 )

following tables set forth period-over-period changes in revenue for each of our reporting segments:

Three-months Ended

September 30, 2023

September 30, 2022

Digital Transformation Technology

Total Revenue

Nine-months Ended

September 30, 2023

September 30, 2022

March 31, 2024

March 31, 2023

Digital Transformation Technology

Total Revenue

was $990,199 and $721,905 for the three months ended September 30, 2023 and 2022, respectively.

Revenue was $21,070,983 and $3,600,482

for the nine months ended September 30, 2023 and 2022, respectively.

The increase in property sales from the Black Oak Project in the

second quarter of 2023 contributed to higher revenue in this period.

late 2022 and early 2023, the Company entered into three contracts with builders to sell multiple lots from its Black Oak project.

sales contemplated by these contracts are contingent on certain conditions which the parties to such contracts will need to meet and

are expected to generate approximately $22 million of funds from operations, not including certain expenses that the Company will be

required to pay.

The sale of 335 lots closed in the first six months of 2023 generating approximately $18.1 million revenue.

was $6,086,207 and $926,936 for the three months ended March 31, 2024 and 2023, respectively.

The increase in property sales from the

Lakes at Black Oak Project in the first three months of 2024 contributed to higher revenue in this period.

Company plans to continue its near-term focus on lot sales to regional and national builders.

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improve the Company’s liquidity, strengthen its financial position and meet is working capital requirements.

May 2023, the Company entered into lease agreement for its model house located in Montgomery County, Texas (AHR Black Oak Lease Agreement”).

The revenue from the lease was $6,300 and $10,500 in the three and nine months ending September 30, 2023.

2022 the last three homes in the Ballenger Project were sold.

In this project, builders were required to purchase a minimum number of

lots based on their applicable sale agreements.

We collected revenue only from the sale of lots to builders.

We are not involved in the

construction of homes at the present time.

from the sale of Front Foot Benefits (“FFBs”), assessed on Ballenger Run project lots, decreased from $9,968 in the three

months ended September 30, 2022 to $0 in the three months ended September 30, 2023.

Income from the sale of FFBs decreased from $126,055

in the nine months ended September 30, 2022 to $0 in the nine months ended September 30, 2023.

The decrease is a result of the decreased

sale of properties to homebuyers in 2023.

from rental business was $705,334 and $569,791 in the three months ended September 30, 2023 and 2022, respectively.

Revenue from rental

business was $2,030,112 and $1,206,273 in the nine months ended September 30, 2023 and 2022, respectively.

The Company expects that the

revenue from this business will continue to increase as we acquire more rental houses and successfully rent them.

from rental business was $707,592 and $633,811 in the three months ended March 31, 2024 and 2023, respectively.

The Company expects that

the revenue from this business will continue to increase as we acquire more rental houses and successfully rent them.

May 2023, the Company entered into lease agreement for one of its model houses located in Montgomery County, Texas.

The revenue from

the lease was $6,300 in the three months ended March 31, 2024.

January 2024, the Company entered into lease agreement for another model house located in Montgomery County, Texas.

The revenue from

the lease was $6,602 in the three months ended March 31, 2024.

recent years, the Company expanded its biohealth segment to the South Korean market through one of the subsidiaries of HWH International

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HWH World recognized

$0 and $ 22,154 in revenue in the three months ended September 30, 2023 and 2022, respectively.

HWH World recognized $12,587 and $771,847

in revenue in the nine months ended September 30, 2023 and 2022, respectively.

$535 and $ 12,786 in revenue in the three months ended March 31, 2024 and 2023, respectively.

category described as “Other” includes corporate and financial services, food and beverage business and new venture businesses.

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addressed as one independent category.

In the three months ended September 30, 2023 and 2022, the revenue from other businesses was $278,545

and $123,595, respectively.

In the nine months ended September 30, 2023 and 2022, the revenue from other businesses was $802,741 and

$319,862, respectively, generated by Korean and Singaporean café shops and restaurants.

In the three months ended March 31, 2024 and 2023, the revenue from other businesses was $332,678

and $1,083,971, respectively, generated by Korean, Singaporean and Chinese café shops and restaurants.

of Revenues and Operating Expenses

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Three-months Ended

September 30, 2023

September 30, 2022

Digital Transformation Technology

Total Cost of Revenues

Nine-months Ended

September 30, 2023

September 30, 2022

March 31, 2024

March 31, 2023

Digital Transformation Technology

Total Cost of Revenues

of revenues decreased from $813,369 in the three months ended September 30, 2022 to $581,059 in the three months ended September 30,

Cost of revenues increased from $2,478,596 in the nine months ended September 30, 2022 to $13,008,833 in the three months ended

September 30, 2023.

The increase is a result of the increase in sales in the Black Oak Project.

Capitalized construction expenses, finance

costs and land costs are allocated to sales.

of revenues increased from $689,281 in the three months ended March 31, 2023 to $4,658,367 in the three months ended March 31, 2024.

The increase is a result of the increase in sales in the Lakes at Black Oak Project.

Capitalized construction expenses, finance costs

and land costs are allocated to sales.

We anticipate the total cost of revenues to increase as revenue increases.

gross margin increased from negative $91,464 to $409,140 in the three months ended September 30, 2022 and 2023, respectively.

margin increased from $1,121,886 to $8,062,150 in the nine months ended September 30, 2022 and 2023, respectively.

gross margin increased from $237,655 to $1,427,840 in the three months ended March 31, 2023 and 2024, respectively.

The increase of gross

margin was caused by the increase in sales in the Black Oak Project.

margin was caused by the increase in sales in the Lakes at Black Oak Project.

following tables sets forth period-over-period changes in operating expenses for each of our reporting segments.

Three-months Ended

September 30, 2023

September 30, 2022

Digital Transformation Technology

Total Operating Expenses

Nine-months Ended

September 30, 2023

September 30, 2022

March 31, 2024

March 31, 2023

Digital Transformation Technology

Total Operating Expenses

decrease of operating expenses of real estate in the first three and nine months of 2023 compared to the same period of 2022 was mostly

caused by the decrease rental related expenses.

Increase in expenses in our other businesses is mainly caused by the increase in professional

and consulting fees.

increase of operating expenses in the first three months of 2024 compared to the same period of 2023 was mostly caused by recording of

goodwill and investment.

Income (Expense)

the three months ended September 30, 2023, the Company had other expense of $14,903,980 compared to other expenses of $ 11,163,538 in

the three months ended September 30, 2022.

In the nine months ended September 30, 2023, the Company had other expense of $28,060,334

compared to other expenses of $25,546,935 in the nine months ended September 30, 2022.

The change in realized and unrealized gain (loss)

on securities investments and loss on consolidation of Alset Capital Acquisition Corp.

are the primary reasons for the volatility in

these two periods.

Unrealized loss on securities investment was $10,742,675 in the three months ended September 30, 2023, compared to

$11,006,833 loss in the three months ended September 30, 2022.

Unrealized gain on securities investment was $6,910,205 in the nine months

ended September 30, 2023, compared to $ 21,773,223 loss in the nine months ended September 30, 2022.

Realized loss on security investment

was $602,624 the three months ended September 30, 2023, compared to a loss of $145,122 in the three months ended September 30, 2022.

Realized loss on security investment was $11,291,166 the nine months ended September 30, 2023, compared to a loss of $6,500,573 in the

nine months ended September 30, 2022.

Loss on consolidation was $21,657,036 in the three and nine months ended September 30, 2023, compared

to loss on consolidation of $0 in the three and nine months ended September 30, 2022.

the three months ended September 30, 2023 the Company had net loss of $17,026,008 compared to net loss of $13,081,391 in the three months

ended September 30, 2022.

In the nine months ended September 30, 2023 the Company had net loss of $27,162,596 compared to net loss of

$30,994,705 in the nine months ended September 30, 2022.

the three months ended March 31, 2024, the Company had other expenses of $5,047,279 compared to other expenses of $2,233,452 in the three

months ended March 31, 2023.

The gain on sale of stock of subsidiary and foreign exchange transaction gain are the primary reason for

the volatility in these two periods.

Gain on the sale of stock of subsidiary was $15,695,977 in the three months ended March 31, 2024,

compared to $0 gain in the three months ended March 31, 2023.

Foreign exchange transaction gain was $1,193,636 the three months ended

March 31, 2024, compared to a loss of $788,302 in the three months ended March 31, 2023.

the three months ended March 31, 2024 the Company had net loss of $7,313,792 compared to net loss of $4,323,182 in the three months ended

March 31, 2023.

and Capital Resources

real estate assets have decreased to $39,905,237 as of September 30, 2023 from $54,618,729 as of December 31, 2022.

This decrease primarily

reflects the sale of properties in the Black Oak project.

cash has increased from $17,827,383 as of December 31, 2022 to $28,038,818 as of September 30, 2023.

Our liabilities increased from $4,827,221

at December 31, 2022 to $8,149,184 at September 30, 2023.

Our total assets have increased to $157,014,408 as of September 30, 2023 from

$153,490,336 as of December 31, 2022 mainly due to increase in cash held in Trust Account after the consolidation of Alset Capital Acquisition

real estate assets have decreased to $39,883,629 as of March 31, 2024 from $42,137,152 as of December 31, 2023.

decrease reflects the sale of multiple lots in Lakes at Black Oak project during first three months of 2024.

cash has decreased from $26,921,727 as of December 31, 2023 to $23,727,542 as of March 31, 2024.

Our liabilities decreased from $9,066,700

at December 31, 2023 to $6,670,132 at March 31, 2024.

Our total assets have decreased to $96,710,288 as of March 31, 2024 from $126,314,028

as of December 31, 2023 mainly due to decrease in cash held in Trust Account after shareholders of HWH International Inc.

redeemed their

April 17, 2019, SeD Maryland Development LLC entered into a Development Loan Agreement with Manufacturers and Traders Trust Company (“M&T

Bank”) in the principal amount not to exceed at any one time outstanding the sum of $8,000,000, with a cumulative loan advance

amount of $18,500,000.

The line of credit bore interest rate on LIBOR plus 375 basis points.

SeD Maryland Development LLC was also provided

with a Letter of Credit (“L/C”) Facility in an aggregate amount of up to $900,000.

The L/C commission will be 1.5% per annum

on the face amount of the L/C.

Other standard lender fees will apply in the event the L/C is drawn down.

The loan is a revolving line

The L/C Facility is not a revolving loan, and amounts advanced and repaid may not be re-borrowed.

Repayment of the Loan Agreement

is secured by a $2,600,000 collateral fund and a Deed of Trust issued to the Lender on the property owned by SeD Maryland.

2022, approximately $2,300,000 was released from collateral, leaving approximately $300,000 as collateral for outstanding letters of

On December 14, 2023 approximately $201,751 was released from collateral, leaving approximately

$100,000 as collateral for outstanding letters of credit.

future development timeline of Lakes at Black Oak will be based on multiple conditions, including the amount of funds which may be raised

from capital markets, the loans we may secure from third party financial institutions, and government reimbursements which may be received.

The development will be step by step and expenses will be contingent on the amount of funding we will receive.

November 13, 2023, 150 CCM Black Oak Ltd.

(the “Seller”), a Texas Limited Partnership, entered into two Contracts for Purchase

and Sale and Escrow Instructions (each an “Agreement,” collectively, the “Agreements”) with Century Land Holdings

of Texas, LLC, a Colorado limited liability company (the “Buyer”).

Pursuant to the terms of one of the aforementioned Agreements,

the Seller has agreed to sell approximately 142 single-family detached residential lots (the “Section 4 Agreement”) comprising

a section of a residential community in the city of Magnolia, Texas known as the “Lakes at Black Oak.” The selling price

of these lots is anticipated to equal approximately $7.4 million.

Pursuant to the other Agreement, the Seller has agreed to sell 63 single-family

detached residential lots (the “Alset Villas Agreement”) in the city of Magnolia, Texas.

In 2021, our subsidiary Alset EHome

acquired approximately 19.5 acres of partially developed land near Houston, Texas which was used to develop a community named Alset

Villas (“Alset Villas”).

Alset EHome was in the process of developing the 63 lots at Alset Villas in 2023.

The selling price

of these lots is anticipated to equal approximately $3.3 million.

The closing of the transactions described above depends on the satisfaction

of certain conditions, and is expected to take place during the second quarter of 2024.

In addition, the Company will be entitled to

receive certain reimbursements in the year ended December 31, 2024 and 2025.

management believes that the available cash in bank accounts and favorable cash revenue from real estate projects are sufficient to fund

our operations for at least the next 12 months.

of Cash Flows for the Three Months Ended September 30, 2023 and 2022

Nine-months Ended

Net cash provided by (used in) operating activities

of Cash Flows for the Three Months Ended March 31, 2024 and 2023

Three-months Ended

Net cash used in operating activities

$ (1,509,247 )

Net cash used in investing activities

$ (3,289,083 )

Net cash provided by financing activities

Net cash (used in) provided by investing activities

$ (1,758,503 )

Net cash (used in) provided by financing activities

Flows from Operating Activities

cash provided by operating activities was $8,255,675 in the first nine months of 2023, as compared to net cash used in operating activities

cash used in operating activities was $1,509,247 in the first three months of 2024, as compared to net cash used operating activities

of $3,289,083 in the same period of 2023.

Property sales from the Black Oak project in 2023 were the main reason for the cash provided

by operating activities in 2023.

Capitalization of real estate expenses was the main reason for the cash used in operating activities

Prepayment of expenses and investment in trading securities were the main reason for the cash used in 2024

Flows from Investing Activities

cash used in investing activities was $748,188 in the first nine months of 2023, as compared to net cash used in investing activities

cash used in investing activities was $1,758,503 in the first three months of 2024, as compared to net cash provided by investing activities

of $671,484 in the same period of 2023.

In the nine months ended September 30, 2023 we invested $734,688 in real estate improvements,

issued $1,693,455 in loans to related parties and received $2,675,735 from repayment of related party notes receivable.

In the nine months

ended September 30, 2022 we invested $8,479,968 in marketable securities, invested $6,057,493 to purchase real estate properties and

$1,082,225 in real estate improvements.

In the three months ended March 31, 2024 we invested $646,785 in marketable securities, issued

$1,144,317 in loans to related parties and received $34,671 from repayment of related party notes receivable.

In the three months ended

March 31, 2023 we invested $412,500 in marketable securities, issued $1,521,368 in loans to related parties and received $2,613,629 from

repayment of related party notes receivable.

Flows from Financing Activities

cash provided by financing activities was $3,408,560 in the nine months ended September 30, 2023, compared to net cash provided of $

5,996,133 in the nine months ended September 30, 2022.

The cash provided by financing activities in the first nine months of 2023 is

caused by the proceeds from stock issuance of $3,433,921.

The increase in cash provided by financing activities in the first nine months

of 2022 was primarily caused by the proceeds from stock issuance of $6,213,000.

believe that inflation has not had a material impact on our results of operations for the three months ended September 30, 2023 or the

year ended December 31, 2022.

We cannot assure you that future inflation will not have an adverse impact on our operating results and

financial condition.

cash used in financing activities was $240,182 in the three months ended March 31, 2024, compared to net cash provided of $3,433,921

in the three months ended March 31, 2023.

In the first three months of 2024 the Company borrowed $119,621 from a third part loan and

repaid $359,803 of note payable.

The cash provided by financing activities in the first three months of 2023 is caused by the proceeds

from stock issuance of $3,433,921.

believe that inflation has not had a material impact on our results of operations for the three months ended March 31, 2024 or the year

ended December 31, 2023.

We cannot assure you that future inflation will not have an adverse impact on our operating results and financial

of Foreign Exchange Rates

effect of foreign exchange rate changes on the intercompany loans (under ASC 830), which mostly consist of loans from Singapore to the

United States and which were approximately $40 million and $51 million on September 30, 2023 and December 31, 2022, respectively, are

the reason for the significant fluctuation of foreign currency transaction Gain or Loss on the Condensed Consolidated Statements of Operations

United States and which were approximately $23 million and $23 million on March 31, 2024 and December 31, 2023, respectively, are the

reason for the significant fluctuation of foreign currency transaction Gain or Loss on the Condensed Consolidated Statements of Operations

and Other Comprehensive Loss.

23 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis